THE NEW COLD WAR: TECHNO-FEUDALISM, CORPORATE EMPIRES AND THE FUTURE OF GLOBAL GOVERNANCE

What if the most powerful political actors in the world are no longer governments, but Chief Executive Officers (hereinafter: CEO)? In the 21st century, sovereignty is influenced considerably, not through treaties or constitutions, but through data ownership, algorithmic control and platform monopolies. In a world once characterised by the ideological clash between capitalism and communism, power is now being redrawn along technological lines. What was once a market-driven system fuelled by competition and state regulation might be evolving into something more centralised, opaque and unaccountable. Techno-feudalism, where technology corporations dominate economic systems, control the flow of information and shape societal norms, has begun to displace the foundational structures of traditional capitalism.

Economist and former Minister of Finance in Greece, Yanis Varoufakis, argues that capitalism is not merely transforming, it is being replaced. In his view, today’s economy is governed less by market exchange and more by digital enclosures, platform monopolies and behavioural data extraction, echoing the power dynamics of feudal hierarchies rather than free enterprise. As corporations like Amazon, Meta and Tesla consolidate their control over digital infrastructure, algorithmic governance and surveillance technologies, they are no longer just private enterprises. They are global empires with geopolitical clout, capable of influencing elections, setting rules of engagement in cyberspace and even stepping into domains once reserved for states, such as space exploration or cyber defence.

In this shifting landscape, one of the most consequential global rivalries of the 21st century has moved beyond traditional concerns of military buildup or ideological confrontation, focusing instead on technological leadership and digital infrastructure. The United States of America (hereinafter: the USA) and China are increasingly engaged in strategic competition over artificial intelligence, semiconductor production and digital infrastructure, areas that are likely to influence future configurations of governance and geopolitical influence. In parallel, the rise of techno-feudalism appears to be gradually shifting elements of authority from public institutions to corporate actors, raising concerns about the long-term resilience of democratic oversight and accountability. The increasing influence of high-profile tech executives such as Elon Musk, Jeff Bezos and Mark Zuckerberg reflects a broader shift in which corporate actors play an outsized role in shaping digital infrastructure, information ecosystems and even policy agendas. Rather than conventional military confrontation, emerging tensions between major powers are now increasingly mediated through competition over data, algorithms and technological influence.

From Capitalism To Techno Feudalism

A. Defining Capitalism: Markets, Enterprise And Regulation

Capitalism is an economic system defined by private ownership of the means of production and operation for profit (for example, factories and businesses), with goods and services distributed primarily through competitive markets. Traditionally, capitalism has been characterised by market competition and free enterprise. In a classic capitalist economy, numerous firms compete to meet consumer demand, and this competition spurs efficiency and innovation. Entrepreneurs are free to start businesses, and prices are set by supply and demand in open markets. Crucially, capitalist markets are undergirded by state regulation that secures property rights, enforces contracts and curbs excesses. Historically, governments have intervened to preserve competition, antitrust laws and trust-busting are emblematic, such as the breakup of Standard Oil in 1911 to prevent monopoly. Ideally, the state thus acts as an umpire in capitalism, ensuring that no single enterprise entirely dominates and that market conditions (like pricing and entry of new firms) remain relatively free. From the industrial revolution onwards, this system of private profit and regulated competition became the dominant mode of production, displacing feudal structures of lords and serfs. Under capitalism, profit is generated through production and exchange: capitalists invest in enterprises, hire labour (paid wages), and sell outputs for profit, theoretically under competitive pressure that keeps those profits in check. This model presumes a clear distinction between profits (returns on entrepreneurial investment under competition) and rents (earnings from mere ownership or monopoly). In summary, classical capitalism’s hallmarks have been decentralised market competition, the pursuit of profit through production and a balancing role for the state to maintain a level playing field and address market failures.

B. The Emergence Of Techno-Feudalism: Monopolies, Data And Cloud Rent

In recent years, scholars and commentators have argued that the digital economy is diverging from these classical capitalist features, leading to what Yanis Varoufakis terms “techno-feudalism”. This concept suggests a fundamental shift in economic order, where the core dynamics resemble feudal rent extraction more than market competition. The rise of giant digital platforms, firms like Amazon, Google, Apple, Meta, Alibaba and others, has created monopolistic or oligopolistic structures that dominate markets and gatekeeper essential services​. Unlike in a competitive capitalist marketplace, these platforms control entire ecosystems: social media, e-commerce, mobile app stores, cloud computing and even sections of the public sphere. Monopolisation replaces competition as a defining feature, as a “handful of vast monopoly platforms” enjoy near-total control in their domains​.

Equally crucial is the shift in how value is generated. Instead of profiting primarily from producing goods or services in competitive markets, platform giants derive wealth by ownership and control of digital infrastructure and data. Varoufakis argues that capital has “mutated into a new form of capital which is called cloud capital, which has killed capitalism”​. By cloud capital, he refers to the networked digital platforms and their hoards of user data that are now important channels of wealth accumulation. These companies operate as platform landlords: they own the “digital real estate” (social networks, app ecosystems, cloud servers) on which others must transact or interact. Through this control, they extract rent rather than traditional profit. Varoufakis calls this rent cloud rent which is analogous to feudal land rent but charged on the “cloud” infrastructure​. For example, when independent producers or sellers use Amazon’s platform or Apple’s App Store, the platform owner takes a substantial cut of every transaction simply for controlling the marketplace. As Varoufakis puts it, Amazon’s Jeff Bezos “doesn’t make anything” but “controls the digital system” and charges a “ground rent, which he calls the cloud rent” on all commerce in his domain. In feudal terms, the company as an infrastructural actor is like a lord who owns the terrain on which merchants and customers must meet; those merchants owe tribute in the form of fees. The result is that cloud rent becomes a major source of revenue and economic power shifts to those who control platforms, not necessarily those who excel in productive competition.

Another defining element of techno-feudalism is data ownership and algorithmic governance. The new “lords” accumulate vast troves of user data – personal information, consumer behaviour patterns, attention metrics – which become a key asset. Shoshana Zuboff documented how surveillance capitalism allowed tech firms to unilaterally claim human experience as raw data and use it to predict and shape behaviour. In Varoufakis’s words, “cloud capital has shattered the individual into fragments of data… which its algorithms are able to manipulate”​. This dynamic illustrates how platform companies increasingly employ algorithms not only to interpret user behaviour but to subtly steer choices and interactions, echoing historical patterns of top-down control over daily life. Algorithmic governance refers to how algorithms (owned by platforms) now set the rules and organise social and economic activity. Rather than markets determining outcomes or democratic institutions setting rules, platform algorithms determine search rankings, news feeds, online prices and even labour conditions (as in gig-work platforms). Jodi Dean observes that in this digital context, individuals often behave as if bound in servitude to platform routines, “digital serfs” contributing content and attention while platforms harvest the value. Users scrolling through social media or gig workers accepting algorithm-assigned tasks are operating in a sphere governed by platform rules more than by open market choices or civic regulation. In essence, techno-feudalism describes a system where ownership of data and digital infrastructure confers the kind of power that ownership of land did in feudal times that the power to extract rent and dictate terms of engagement. These arrangements mark a departure from the capitalist norm of arms-length exchanges in open markets; instead, large portions of economic life occur on privately governed platforms.

C. Platforms Monopolies And Infrastructural Power: Technology Corporations As New Overlords

The trends associated with techno-feudalism can be observed in the growing influence of major technology corporations, whose control over key digital infrastructures has, in some cases, extended into areas with geopolitical relevance. Under platform capitalism, corporations leverage network effects and data to gain market dominance and infrastructural control. However, the extent to which these firms operate with minimal oversight varies by region. While companies in the USA have established expansive monopolies that shape policy and governance, counterparts in regions like China and the European Union remain subject to more assertive state regulation, competition enforcement and consumer protection mechanisms. Amazon is a suitable example. It started as a retailer, but today Amazon’s Web Services cloud servers host a huge swath of the internet (including government and corporate data), and its e-commerce marketplace controls access to consumers for millions of merchants. Amazon’s platform has become a central node in contemporary commerce – an infrastructure that many sellers depend on to access digital markets. Its success lies in building an efficient and scalable business model, yet its dominance also reflects a broader political-economic context in which regulatory systems have allowed such platforms to consolidate power and shape market access with limited oversight. This permits Amazon to charge fees (a form of cloud rent) to sellers and to preferentially promote its own products, weakening the traditional capitalist feature of open competition. In Amazon’s case, third-party sellers effectively become “vassals paying tribute” for the right to trade, and consumers are captive to Amazon’s one-click convenience and fast delivery network. The platform has effectively absorbed large segments of the market, placing independent sellers in a position of structural dependence. Google (under Alphabet) similarly commands infrastructural power over information and knowledge. Google’s search engine monopoly (over 90% of global search queries) means it controls the discovery and flow of information, any business or media outlet must heed Google’s algorithms (search rankings, ad placements) to be visible. This gives Google the ability to extract rent from advertisers for access to users’ attention, a business model Shoshana Zuboff calls surveillance capitalism. Google aggregates users’ data and sells targeted advertising, effectively monetising the surveillance of user behaviour. While this remains a form of profit-seeking, the primary source of value lies in the platform’s ability to monetise user data and sustained attention, rather than in the competitive sale of tangible goods or services. Moreover, Google’s algorithms govern what information people see (a form of private governance), and changes in those algorithms can make or break other businesses. This power over information infrastructure has geopolitical implications too – for instance, control over map data, search data, and artificial intelligence research places Google in a position to influence public opinion and even national security (e. g. providing artificial intelligence or cloud services to governments, as seen in debates over Project Maven and others). Apple offers another angle on platform power: Apple offers another perspective on platform dominance: its operating system and application download environment create a closed ecosystem that governs access to over a billion mobile device users globally.. Through strict control of its application downloading system, Apple effectively monopolises the distribution channel for mobile apps on its devices and imposes a 30% commission on digital sales (a notable example of cloud rent extraction). Developers, even large ones like Epic Games, have little choice but to comply with Apple’s terms, much like tenants on another’s land. Apple’s closed ecosystem prioritises its own services and can stifle competing apps (for example, limiting third-party payment systems or pre-installing its own apps), thereby undermining the free-enterprise ideal of equal opportunity. The situation mirrors feudal privilege: Apple, as the lord of its platform, grants or denies other firms access to its user base and taxes their revenue. This gatekeeping power has been challenged in courts as anti-competitive, but thus far Apple maintains tight control, underscoring how traditional regulatory mechanisms struggle to check platform monopolies. As Varoufakis notes, breaking up such digital conglomerates is technically complex: unlike Standard Oil’s physical assets, one cannot easily split an integrated digital network like Amazon or Apple into smaller competing pieces​. The very nature of digital platforms, global, networked and centred on intangible assets, makes conventional antitrust tools less effective, allowing these companies to entrench their quasi-feudal dominance.

Beyond the consumer internet, technology corporations’ power extends to critical infrastructure and even outer space, blurring lines between corporate and state domains. This dynamic, private ownership of essential services historically managed by the state, is also evident in Elon Musk’s ventures, such as SpaceX and Starlink. SpaceX, a private rocket company, has become the dominant player in launching satellites and even transporting astronauts, roles once reserved for national space agencies. Its satellite internet network, Starlink, now provides broadband to millions, including critical connectivity in conflict regions. In the Ukraine conflict, Starlink’s service became a lifeline for the Ukrainian military’s communications; tellingly, Musk unilaterally decided to limit Starlink’s use for offensive drone operations, effectively making a military and geopolitical decision. This incident underscores the complex geopolitical implications of private ownership over critical infrastructure, where a corporate executive may influence the conditions under which state actors operate during conflict. Such power is reminiscent of feudal lords who could influence kings’ wars due to their control of fortresses or roads. Today, control over satellites and networks endows tech elites with leverage over governments, enabling rent extraction and strategic influence on a global scale. In peacetime, Starlink and similar systems allow their owners to charge governments or users for access (a modern form of rent for essential connectivity) and to shape the development of global internet governance. These examples show how platform monopolies function as new feudal lords: they own critical infrastructure (digital or physical) that others depend on, and they exploit this dependence to collect tolls (fees, rents) and enforce their own rules. Crucially, this arrangement weakens traditional capitalist dynamics. Competition is stifled because would-be competitors must either join the platform (and become vassals) or be excluded from the market. Small firms and even states become dependent on privately owned networks, eroding the sovereignty of both markets and governments. As Varoufakis observes, in the “Age of Cloud Capital” even the usual tools of state regulation (price controls, antitrust) falter: prices to consumers on many platforms are low or zero (so price regulation seems moot), and breaking up networks is technically challenging​. Platform owners thus feel “safe” from the kind of regulatory oversight that disciplined industrial capitalists in the 20th century. The net result is a shift toward a rentier-centric system, where owning and controlling the platform yields sustained dominance in ways that recall the hereditary privileges of feudal aristocracies more than the dynamic competition of capitalist entrepreneurs.

D. Contrasting Capitalism And Techno-Feudalism

The contrasts between traditional capitalism and emergent techno-feudalism can be summarised in terms of competition, sources of value and governance. In classical capitalism, markets are the organising principle: numerous firms compete, no single actor dictates market outcomes unilaterally and profits are earned by producing valued goods or services more efficiently than rivals. In techno-feudalism, economic activity is increasingly coordinated through platforms, where algorithmic governance and centralised control displace traditional market dynamics. Instead of decentralised interactions among independent buyers and sellers, value exchange is often structured around a single dominant platform that mediates and controls access. This means competition is either suppressed or internalised: for instance, app developers might compete for rankings within Apple’s application download system, but Apple sets the terms and can exclude players at will. The traditional capitalist ideal of open competition is thus curtailed by monopolistic enclosure of the market. Jeremy Gilbert notes that while some argue capitalism is coming to an end, an alternative perspective frames the current moment as “platform capitalism,” a new regime of accumulation where capitalist logics persist under the dominance of digital intermediaries. From Gilbert’s perspective, the basic profit motive and class structure remain, even if competition is attenuated; thus, what Varoufakis calls techno-feudalism could be seen as late-capitalism in a new guise. This debate raises the broader question of whether current developments should be understood as a fundamental break with capitalism or as part of its ongoing evolution. Varoufakis and others argue a qualitative break, feudal-style rentiers overtaking industrial capitalists, whereas Gilbert and the Regulation School see continuity in how capital adapts to new technologies​. A key distinction lies in how value is generated. In industrial capitalism, surplus was extracted through wage labour and productivity. In techno-feudal dynamics, value increasingly derives from data and user engagement rather than formal employment. Whether this constitutes greater exploitation depends on the criteria – such as autonomy, compensation or consent. Users of platforms like Facebook or Google are not paid workers but generate value through their data and interactions. Rather than producing commodities, platforms profit by extracting rent through data-driven engagement and control over digital access. As Srnicek notes, once a platform secures a large user base, it positions itself as an intermediary for entire markets, with cloud capital data, networks and algorithms, becoming its key productive asset. Indeed, Varoufakis’ thesis is that “profit drives capitalism, but rent drives feudalism,” and today we see a reemergence of rent as dominant, indicating a transition from one system to another. They are less concerned with outperforming rivals through better products (since rivals are few or none in their fiefdom) and more focused on maintaining users and dependencies to ensure a steady rent flow. This rent-centric model weakens the link between value and labour that underpinned industrial capitalism – for example, much of the content on social media is produced by users for free, yet the platform owner reaps the profit, a scenario that upends classical notions of labour-based value creation.

Governance and sovereignty also differ markedly. Capitalism, especially in its liberal democratic context, relies on a nation state setting the legal parameters (even if favouring capital). Feudalism, by contrast, was decentralised: lords governed their own territories with limited central oversight. In a techno-feudal order, we observe a similar dispersion of authority, but under private ownership, platform companies enforce rules, remove users and shape discourse within digital spaces they control. While this might resemble decentralisation, it lacks democratic accountability or legal transparency. Unlike states, platform owners are not publicly elected, yet their decisions affect millions, raising questions about legitimacy, consistency and rights protections in the governance of online life. McKenzie Wark speaks of a new ruling class of “vectoralists” who control information vectors (networks, intellectual property) as the basis of power, supplanting the industrial capitalist class. Varoufakis similarly labels the new elite “cloudalists” (those who own cloud capital)​. These terms indicate that power is now vested in controlling the channels of information and connection. Algorithmic governance means that platform algorithms play the role of law and regulator within these private fiefdoms. For instance, Uber’s algorithm dictates ride prices and driver assignments, tasks a market or a regulator might do in a traditional system. The consequence is an erosion of public regulatory power: states find it difficult to assert control, as seen in struggles to regulate data privacy, online speech or antitrust issues across global platforms. Cloud-era corporations often appear resistant to traditional regulation; especially in contexts like the USA, where state institutions rely on private infrastructure. In such cases, the balance of power can shift, allowing companies significant leverage in shaping policy or terms of engagement. This reversal, private entities holding sovereign-like power, starkly contrasts with the ideal of the state as supreme authority in capitalism that can nationalise or break up firms if needed. In a techno-feudal scenario, the political order is also altered: wealth and power concentrate in a few hands who can influence laws or evade them, leading to concerns about a new form of neo-feudal hierarchy in society.

The New Cold War: US–China Rivalry In The Age Of Techno-Feudalism And The Decline Of Europe And Japan

The 20th-century Cold War was a geopolitical standoff between the USA and the Soviet Union, defined by ideological opposition, capitalism versus communism and played out through an arms race, proxy wars and nuclear deterrence. However, the 21st century introduces a different kind of global conflict, one shaped not by ideologies, but by technological supremacy. The evolving USA–China rivalry increasingly extends into domains such as artificial intelligence (hereinafter: AI), semiconductors, quantum computing and digital infrastructure, highlighting the growing strategic importance of technological capabilities alongside conventional military power. Within these emerging dynamics, the concept of techno-feudalism offers a useful framework for understanding how digital monopolies and cloud capital are reshaping global influence, with geopolitical leverage increasingly tied to control over platforms, data flows, and algorithmic infrastructure. Varoufakis argues that the privatisation of the internet by North American and Chinese tech firms signals a shift away from market-based capitalism toward a techno-feudal structure, where power stems less from production and more from digital enclosures. These corporate platforms extract value through cloud infrastructure, data harvesting, and algorithmic control. In this framework, cloud capital becomes the strategic asset of the new age, powerful enough to displace profit as the primary engine of economic activity. The New Cold War reflects this shift: it is a struggle over cloud supremacy.

Unlike the historic Cold War, which was largely bipolar, today’s geopolitical tensions unfold across a fragmented digital landscape. The USA and China lead in areas like AI and platform infrastructure, while the EU and Japan pursue alternative paths. Europe’s focus on regulation, consumer protection and social welfare has slowed certain innovations but strengthened digital rights. Varoufakis argues that limited investment in native platforms has increased EU dependence on foreign tech firms. Japan, meanwhile, faces difficulties transitioning from hardware dominance to AI and software ecosystems. The key terrain in this conflict is semiconductors and AI. Semiconductors are the backbone of the modern economy, critical for smartphones, data centres, weapons systems and AI models. The USA has taken aggressive steps to curb China’s access to advanced chips, including export bans and pressuring allies like the Netherlands and Japan to restrict sales of chip-making equipment. In turn, China is investing billions in national chip production and AI development. The recent debut of DeepSeek, a Chinese AI model rivalling USA’s ChatGPT, underscores how AI has become a domain of national prestige and strategic leverage. Cybersecurity and data sovereignty are additional flashpoints. The USA has banned Chinese-owned apps like TikTok from government devices, citing concerns over surveillance and influence operations. Similarly, Chinese firms like Huawei have faced sanctions over their alleged ties to China’s governing party and potential backdoors in 5G infrastructure. These measures reflect a broader “digital decoupling” trend, where the USA and China seek to separate their digital ecosystems to protect national interests. What makes this technological Cold War uniquely techno-feudal is the blurring of lines between state and corporate power. In the USA, the government increasingly relies on private tech firms for military, surveillance and space capabilities. Companies, like Palantir, provide AI tools for intelligence agencies, while Amazon Web Services hosts cloud servers for both the defence ministry and the intelligence service. SpaceX and Starlink have become vital for defence logistics and satellite communications. During the war in Ukraine, Starlink enabled Ukrainian battlefield communications, until the corporation restricted its use for offensive drone strikes, effectively making a geopolitical decision once reserved for states.

In China, corporate power is embedded within a state-led framework. Major technology firms such as Alibaba, Tencent, and ByteDance operate under the oversight of the Chinese Communist Party (hereinafter: the CCP), which maintains ultimate control over digital infrastructure, data governance and platform regulation. This model represents a fusion of platform capitalism and centralised planning, where digital innovation is permitted, even encouraged, but always within the political boundaries set by the state. The CCP actively audits corporate actors, imposes data localisation laws and integrates companies into state priorities through instruments like the Social Credit System and cybersecurity regulations. While this centralised control raises legitimate concerns about surveillance, censorship and the suppression of dissent, it also enables a level of strategic coordination and public oversight that is largely absent in more privatised systems like that of the United States. The state’s ability to rein in corporate excess and assert digital sovereignty has, in some cases, allowed it to address power asymmetries between platforms and citizens, though at the cost of personal liberties, independent expression and pluralistic debate. Rather than dissolving corporate dominance, the Chinese model absorbs it into the machinery of statecraft. As Europe and Japan navigate regulatory constraints and slower innovation, the emerging contest between the United States and China is increasingly framed around influence in digital and technological domains. Unlike the overt military brinkmanship of the 20th century, today’s competition plays out through chip export controls, patent regimes, cybersecurity alliances and AI development benchmarks. Success may depend less on conventional military assets and more on the ability to shape digital standards, information flows and behavioural systems at scale. This evolving rivalry is not only geopolitical; it reflects deeper shifts in the global governance landscape. If current trends continue, future rule-making in the digital realm is unlikely to be led by democratic institutions alone. Instead, governance will increasingly be driven by transnational technology firms and state–corporate alliances, with public accountability subordinated to proprietary algorithms and geopolitical strategy. The trajectory points toward a fragmented digital order shaped not by universal values, but by competing infrastructures of control.

Global Governance In The Age Of Techno-Feudalism

Traditional models of governance are under pressure as a small number of technology executives and firms accumulate significant influence over economic structures and societal systems. As Yanis Varoufakis notes, firms like Google, Amazon and Meta derive their power not from physical assets, but from control over digital infrastructure and data, what he calls “cloud capital, the new digital lands.” In this model, user-generated data and attention become key sources of profit, while public institutions struggle to regulate corporations operating beyond national borders. This shift in authority from state to platform recalls Michel Foucault’s concept of biopolitics; the governance of life through mechanisms that manage populations, behaviours, and social processes. The control exercised by technology companies over personal data, online activity, and the flow of information constitutes a form of private biopower: an ability to “ensure, sustain and multiply life, to put this life in order” within algorithmically governed digital environments. In effect, platforms govern key aspects of individuals’ lives (communication, social interaction, access to knowledge) outside traditional democratic accountability. This can be described as a post-democratic condition: a “fusion of corporate power with government, generating an elite politics…in which money buys power and power rewards money”, while maintaining a façade of democratic processes. Under post-democracy, elections and institutions formally persist, but real decisions are shaped through elite transactions between tech corporations and state actors, largely removed from public participation. This section examines three future scenarios for global governance amid this techno-feudal drift, (1) continued corporate dominance, (2) a resurgence of state regulation and (3) decentralised alternatives, weighing how each might address the collapse of traditional governance in the face of digital oligarchy.

A. Scenario 1: Continued Corporate Dominance

In the first scenario, current trends intensify as technology corporations continue to expand their influence over digital infrastructure and governance. Democratic nation-states struggle to keep pace, while platform companies increasingly shape rules, access, and norms in online spaces, often with limited public oversight. We already see indications of this in how social media and e-commerce actors set the rules for online speech and commerce through their terms of service and algorithms, often with minimal oversight. The risks of this scenario are significant. The challenge posed by large technology companies is not their governance structure – corporations have always operated hierarchically – but their scale, reach and the absence of early regulatory frameworks. In the USA, firms like Meta, Google and Amazon expanded rapidly in loosely regulated environments, acquiring capacities that allow them to shape key areas of economic and social life. Their algorithms influence public discourse by curating what content is seen or amplified, which can contribute to phenomena such as misinformation and political polarisation. Without meaningful oversight, this dynamic risks normalising a system where core aspects of digital interaction are governed by private entities with limited public accountability. If unchecked, a digital oligarchy could entrench a form of “managed society” where citizens become digital vassals with little say in how platforms handle their personal data or moderate public spaces. This outcome aligns with Crouch’s post-democracy: a “plausible imitation of democracy” persists, but policy agendas are set through elite networking between government and corporate power. The public interest risks being subordinated to profit motives – for example, content moderation might prioritise advertisers’ preferences over human rights. Biopolitical control by corporations could also expand (for example, tech companies influencing health, behaviour and social outcomes via data-driven nudges), further displacing the state’s role in protecting citizens’ welfare. The possibilities in this scenario are mostly skewed toward the corporations: continued innovation and convenience for consumers, perhaps, but at the price of diminished individual autonomy and civic agency. In short, a future of unabated corporate dominance resembles a high-tech feudal order with vast power asymmetries between a handful of tech lords and the general populace​.

B. Scenario 2: State-Led Reassertion Through Regulation

In a second scenario, democratic states and supranational bodies reassert governance authority over digital platforms through robust regulation and antitrust enforcement. The European Union (hereinafter: the EU) is often cited as a pioneer in this approach. The EU’s General Data Protection Regulation (hereinafter: GDPR) in 2018 was “the biggest change to data protection law for a generation,”​ instituting strict consent and data rights that forced changes in how tech firms operate globally. Building on GDPR, the EU has enacted a “wave of European regulatory activity”​ targeting technology monopolies. The Digital Markets Act (hereinafter: the DMA) and Digital Services Act (hereinafter: the DSA), both passed in 2022, impose obligations on major platforms to ensure fair competition and accountability in content moderation​. Under the DSA, for instance, large social media must provide transparency in takedowns and allow users to opt out of algorithmic feeds​. The EU is also spearheading AI governance: the EU AI Act, entering into force in 2024, is the world’s first comprehensive AI law, categorising high-risk AI systems for stringent oversight. These measures reflect a broader push for the state to regain control over digital ecosystems in the public interest, from breaking up monopolies to enforcing privacy, safety and competition online. Such reassertion could help protect democratic accountability: by setting rules through elected legislatures and regulators, it brings tech governance back into the realm of public law rather than private fiat. However, the effectiveness of state-led regulation faces significant challenges. For one, technology companies are global and can exploit jurisdictional gaps. Enforcement is difficult, even the EU’s ambitious laws hinge on platform compliance and regulators’ capacity to monitor. A Meta or Google with billions of users may find ways to delay or dilute compliance; indeed, critics note that tech giants sometimes only nominally comply. According to one European analyst, platforms went from “effectively no regulation to heavy regulation” in the EU, a “Glass-Steagall moment for technology corporations”, yet “the companies do not pretend any more that they want to comply”​. There is also political backlash against aggressive regulation. Populist and pro-business voices argue that bureaucrats are overreaching. For example, a member of the parliament in the USA, James David Vance, echoing sentiments at a conference in 2025, decried European tech laws like GDPR as “endless legal compliance costs” and the DSA as “policing so-called misinformation”​, casting them as threats to free speech and innovation. Such rhetoric highlights a tension: in reasserting authority, states must avoid veering into heavy-handed bureaucracy or censorship that could fuel further backlash. Another challenge is that traditional antitrust tools are slow. Lawsuits to break up firms can take years and may not succeed; as former regulator Jason Furman notes, the USA case against Meta (seeking to unwind its Instagram and WhatsApp acquisitions) “makes sense” but “will take a long time and may not succeed,” and even a win “still does not address many companies and behaviours” outside that case​. Thus, regulators are exploring new tools, for example, pro-competition rules requiring data portability and interoperability, to curb monopoly power in a timelier way. The risks of this scenario include potential over-correction: onerous rules might stifle innovation or entrench incumbents (who can afford compliance) over startups. International divergence in regulations could fragment the internet. Nonetheless, the possibilities are hopeful: effective state intervention could restore a measure of democratic oversight and public accountability. By imposing transparency, checks on market dominance and standards aligned with rights (privacy, safety, competition), states can act as egalitarian counterweights to technocratic power. The EU’s efforts, for instance, aim to ensure digital infrastructure serves citizens rather than just shareholders, potentially realigning the tech sector with the public interest. Much will depend on political will, global coordination and adapting regulatory regimes to fast-evolving technologies. If successful, this scenario could temper techno-feudal tendencies and reinvigorate the capacity of democratic governance to steer the digital economy.

C. Scenario 3: Decentralised Alternatives And Web3

A third scenario envisions the emergence of a decentralised internet, often grouped under the umbrella of Web3, where power shifts away from both state institutions and corporate platforms. This vision is grounded in the development of blockchain-based infrastructure, decentralised autonomous organisations (hereinafter: DAOs), and peer-to-peer protocols that seek to displace the monopolistic intermediaries of Web2. Proponents argue that such technologies can foster a more democratic digital space by enabling individuals to transact, communicate, and self-govern without the need for centralised authorities like Meta, Google, or Apple. In principle, these systems promise user sovereignty, data ownership, and algorithmic transparency, features that directly respond to the structural asymmetries of techno-feudalism. However, the normative appeal of decentralisation frequently rests on assumptions about participation, virtue, and civic capacity that are difficult to sustain at scale.

The absence of traditional authority structures in decentralised ecosystems is often celebrated as a form of liberation, yet this lack of formal governance presents a significant risk. Without enforced norms, shared standards or institutional checks, decentralised systems tend to reconstitute the very inequalities they aim to overcome. As political theory and behavioural economics suggest, human agents do not operate in a vacuum of perfect rationality or virtue. In practice, when rules are weak or absent, power concentrates informally in the hands of those with superior resources, technical knowledge or early access. In blockchain-based systems, this often manifests in the dominance of core developers, large token holders or mining/validation networks that effectively determine the direction of a supposedly decentralised protocol. Varoufakis (2023) has cautioned that DAOs and other Web3 governance structures are already being co-opted by wealthy actors who use decentralised tools to consolidate influence rather than dismantle it. “We already see,” he writes, “how DAOs are being usurped by regressives and real estate moguls.” This is not merely a coincidental feature of early-stage technologies; it is a structural outcome of governance vacuums. Without robust democratic institutions or mechanisms of accountability, decentralisation becomes a vector for new forms of plutocracy, where power operates through informal concentration rather than formal monopoly. From a historical-institutionalist perspective, this reflects a recurring pattern: where formal authority withdraws, informal hierarchies take shape. Furthermore, the analogy between decentralised digital systems and self-regulating communities often fails to acknowledge the need for institutional design. As in parenting, pedagogy or collective sport, durable and fair systems require frameworks for behaviour, sanctions for abuse and structures that incentivise pro-social cooperation. Freedom, in the absence of order, becomes fragile: vulnerable to manipulation, factionalism and illegitimacy. The mere presence of open code or token voting does not guarantee democratic outcomes. Many DAOs have struggled with chronic low participation, decision paralysis or dominance by whales (large token-holders), creating outcomes more reminiscent of oligarchic shareholder meetings than participatory governance.

The decentralised web also faces critical structural constraints. Most users remain unfamiliar with Web3 applications or are deterred by technical complexity, security concerns and limited usability. Moreover, key infrastructural vulnerabilities such as smart contract failures, governance hacks or exit scams, raise significant concerns about user protection and system reliability. These shortcomings are not simply transitional obstacles; they reflect the absence of institutional mediation that, in traditional governance systems, provides legitimacy, enforceability and recourse. In addition, decentralisation does not unfold in a political vacuum. Incumbent technology firms are not static entities waiting to be disrupted. Some are actively investing in or co-opting Web3 technologies to retain influence over emerging infrastructures. Meta’s involvement in digital wallets and blockchain identity systems, or Amazon’s integration of decentralised data management tools, illustrate how major actors are already working to domesticate the radical potential of decentralisation. At the same time, state authorities are beginning to assert regulatory oversight over decentralised technologies, with legislation such as the European Union’s Markets in Crypto-Assets Regulation (hereinafter: MiCA) and growing scrutiny of decentralised finance (hereinafter: DeFi). These developments suggest that even if Web3 platforms do proliferate, they are unlikely to exist beyond the reach of sovereign states or legacy capital. Taken together, these dynamics complicate the notion of decentralisation as a definitive escape from techno-feudal power. While the decentralised scenario does offer promising experiments in peer governance, collective ownership and privacy-preserving architectures, it is not immune to the structural challenges of power concentration, institutional fragility and regulatory ambiguity. As a political model, it remains embryonic, lacking the civic infrastructures, legal frameworks and cultural norms required to realise its democratic potential. Without these, decentralisation may merely produce new elites, not emancipated publics.

Therefore, if decentralised technologies are to provide a meaningful alternative to platform monopolies and state overreach, they must be accompanied by a broader political project: one that integrates decentralised systems into legal-democratic institutions, fosters civic digital education and establishes enforceable standards for transparency and accountability. In the near term, decentralised infrastructures are likely to coexist with traditional digital systems offering sites of resistance, experimentation and partial autonomy rather than full systemic transformation. Whether they evolve into instruments of liberation or new enclosures will depend less on code alone, and more on the political conditions in which that code operates.

Conclusion

The rise of techno-feudalism represents more than a mutation of capitalism, it signals a structural shift in how power, sovereignty, and governance operate in the digital age. As unelected corporate actors command digital infrastructure and shape public life through algorithms and platforms, democratic institutions increasingly struggle to retain authority. The new Cold War between China and the USA underscores this transformation, revealing a geopolitical rivalry not over ideology, but over technological dominance and infrastructural control.

Looking ahead, democratic states must move beyond piecemeal regulation and adopt a structural approach to digital governance. Rather than mirroring authoritarian control or surrendering to corporate monopolies, they must establish frameworks that embed transparency, public accountability and civic oversight into the core of technological infrastructure. This requires enforcing interoperability between platforms, strengthening competition law to address digital monopolies, investing in public-interest alternatives to artificial intelligence and cloud services, and enshrining robust data rights through legislation akin to the European Union’s General Data Protection Regulation (GDPR) or the United Kingdom’s Online Safety Act. Yet governance is not the state’s responsibility alone. As users, citizens can resist platform dependency by supporting decentralised technologies, demanding ethical standards from providers and participating in digital literacy initiatives that foster public awareness and critical engagement. The future of digital democracy depends not just on who writes the code, but on who is empowered to shape its consequences. Without collective action, both political and civic, we risk ceding the governance of everyday life to infrastructures that undermine the public interest.